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tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
tesoro Code of Ethics
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tesoro Code of Ethics

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  • 1. Tesoro's Codeof Business Conduct doing the RIGHT thing
  • 2. Dear Fellow Employee: At Tesoro, we believe in doing the right thing, maintaining the highest standards of business conduct and ethics, and ensuring that our actions consistently reflect our Corporate Core Values: • Honesty and Integrity • Respect and Trust • Commitment to Excellence • Creative and Entrepreneurial Spirit • Teamwork • Safety and Environmental Stewardship Our values describe the personal characteristics we expect from our teams as they pursue our vision and strategic goals. These values encourage a culture of integrity and accountability that permits us to be a best practices employer, an honest and trustworthy business partner, and a good corporate citizen. This is how we create sustainable value for our shareholders. We have developed a Code of Business Conduct to make certain everyone understands what is expected. The Code outlines the common values that guide our workplace actions and reflects the business practices and principles of behavior that support this commitment. We expect every employee, officer, and director to read and understand these standards and to follow them in their daily business activities. We also expect employees to contact the Business Conduct Office if they have any reason to believe that an action of Tesoro or its employees could violate our standards. Thank you in advance for your compliance. Adherence to our Code is absolutely critical to Tesoro’s success. Sincerely, Bruce A. Smith Chairman, President, and Chief Executive Officer
  • 3. The Way We Work at Tesoro We are pleased to present our Code of Business Conduct that summarizes the standards that govern how we conduct our business. This Code, our policies and procedures, and our work rules describe how we work at Tesoro. We want our company to succeed and how we conduct our business is highly important in defining our success. The ways in which we conduct ourselves are just as important as the results that we achieve. This is why we have established a business conduct and compliance program. This program helps define our commitment to legal and ethical business conduct.
  • 4. Our Core Values Our core values guide our decisions and describe the type of company we are. They inspire us to excel. Tesoro’s core values are the foundation for assuring we “do the right thing.” • Honesty and Integrity • Respect and Trust • Commitment to Excellence • Creative and Entrepreneurial Spirit • Teamwork • Safety and Environmental Stewardship Key Messages Here are some of the most important things to remember: • Respect the dignity of everyone. • Listen openly to concerns and suggestions. • Carefully obey the laws and follow the policies that govern how we conduct our business. • You don’t have to make tough decisions alone. • We will not compromise our values to meet financial plans or goals.
  • 5. Table of Contents Welcome doing the RIGHT thing Using this Code . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Our Code of Business Conduct and Ethics Code of Ethics for CEO and Senior Financial Officers Doing Business Around the World Speaking Up to Get Answers Talking with Your Supervisor or Manager Talking with Human Resources Contacting the Business Conduct Office Making Tough Decisions A Culture of Compliance . . . . . . . . . . . . . . . . . . . 11 Duty to Comply What Our Program Offers Calling the Code of Conduct Helpline Prohibition Against Retaliation Conducting Investigations Disciplinary Action Working Together . . . . . . . . . . . . . . . . . . . . . . . . . 16 Confidentiality and Privacy Drug and Alcohol Abuse Equality in Employment Harassment Workplace Violence Conducting Our Business . . . . . . . . . . . . . . . . . . 23 Antitrust, Sales Practices, and Fair Dealing Business Records and Internal Controls Conflicts of Interest Fraud General Procurement Gifts, Hospitality, and Entertainment Insider Information Political Contributions Sensitive Payments Protecting Resources . . . . . . . . . . . . . . . . . . . . . . 34 Company Property and Technology Environment, Health, and Safety Intellectual Property Media and External Contacts Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
  • 6. Using This Code Our Code of Business Conduct and Ethics This Code is a common-sense guide that you can use to make good business decisions. This Code applies to everyone at Tesoro. Each Tesoro employee and Board of Directors member is expected to read, understand, and follow our Code. The Code will help you: • esolve difficult questions about conduct on the job. R • Apply the policies and laws that control and guide our business. • Work with your fellow employees, customers, usiness partners, b competitors, regulators, vendors, and suppliers. • ring to our attention suspected illegal or unethical behavior. B We expect our suppliers, vendors, contractors, and business partners to be familiar with our Code and support effective compliance programs within their own organizations. Only the Compliance Officer and General Counsel can waive a provision of our Code. If required by law or regulation, we will report or disclose waivers as appropriate. This Code is a living document and it will change over time. However, this Code is not an employment contract between you and Tesoro. In addition to this Code, Tesoro has policies and procedures that describe how to apply the law to our business operations. You are expected to know and follow the policies that apply to your work. All of Tesoro’s policies are available to our employees, on our intranet site. We offer on-line training about our Code and policies to help you understand these concepts. The content of our Code is governed by Tesoro’s policies. In the event that this Code is in conflict with Tesoro’s policies, the policies will govern. Code of Ethics for CEO and Senior Financial Officers Tesoro’s Chief Executive Officer, Chief Financial Officer, and other financial professionals are expected to act ethically and promote honest business conduct. All provisions of this Code apply to our CEO, CFO, Controller, and persons performing similar functions. We have adopted a complementary code of ethics for these individuals that further highlights their particular duties and commitments. doing the RIGHT thing 6
  • 7. Doing Business Around the World Tesoro conducts its business in the U.S. as well as in other countries. We are subject to the laws of the United States, as well as the laws of the countries where we do business. Our Code reflects our commitment to obey not only the laws but also to respect the principles upon which these laws are based. The sheer complexity of laws and regulations can make it difficult to make a good decision. In some instances, there may be a conflict between the laws of two or more countries. If you have a question about the right course of action to take, contact our Legal Department. Just because the laws are complicated or hard to follow does not mean that we are excused from complying. Speaking Up to Get Answers Most of us have faced a difficult situation where the right course of action was hard to determine. Perhaps the facts were complex. Perhaps a “good” choice was just not obvious. Perhaps your personal interests were inconsistent with the best interests of Tesoro. Maybe you did not have the information you needed to make an informed choice. When you understand our expectations for legal and ethical conduct, you can handle most situations. You can act with confidence. However, this Code will not give you an answer for every situation. No code can do that. When you are unsure about the right course of action, discuss the situation with your supervisor. If that is uncomfortable or impractical, get help. When you see or hear something that you believe is improper, contact one of these resources. When you speak up, you help to prevent misconduct and correct problems. We will not tolerate retaliation against anyone who needs help, asks questions, or reports concerns about workplace conduct. You have several avenues to get advice: • Your supervisor or manager • Human Resources • Code of Conduct Helpline at 1-877-782-3763 • Business Conduct Office • Compliance Officer and General Counsel Talking with Your Supervisor or Manager Every supervisor and manager is expected to keep an “open door” and to provide timely advice on business conduct concerns. Though some situations may be uncomfortable, we encourage you to talk at any time with your supervisor or manager so that a good solution can be reached for everyone. If you report unethical conduct or questionable accounting or 7 Good Ethics is Good Business
  • 8. auditing matters to your supervisor or manager, they will promptly notify the Business Conduct Office for assistance in resolving the problem. Talking with Human Resources Many business issues involve human resources' policies and practices. Contact Human Resources if your concern involves fair employment practices, management practices, compensation, benefits, transfers, or promotions. If you choose to report unethical conduct to Human Resources, they will promptly notify the Business Conduct Office for assistance in resolving the problem. Remember: When in doubt, always ask. Contacting the Business Conduct Office Our Business Conduct Office is a company-wide resource where you can get help with business ethics and compliance. If you have a question, want to express a concern, or report a possible violation of law or our policies, contact the Business Conduct Office by e-mail at business.conduct@ tsocorp.com. Often, this Office can provide you with immediate advice. If your issue requires additional attention, they will keep you informed of progress on your question. You can also call the Code of Conduct Helpline at 1-877-782-3763. Our Business Conduct Office reports directly to the Compliance Officer and General Counsel, who meets regularly with the Audit Committee of the Board of Directors. If you have concerns or complaints regarding questionable accounting, auditing, internal controls, or other financial matters, you are expected to report your concerns to the Business Conduct Office or the Code of Conduct Helpline. You may also contact our Audit Committee Chairman directly by writing to: Chairman The Audit Committee 300 Concord Plaza Drive San Antonio, Texas 78216-6999 To Learn More Policy 10.20.001, Code of Business Conduct and Ethics doing the RIGHT thing 8
  • 9. Making Tough Decisions The answers to some problems may not be obvious. In our work, we face some tough decisions. If you are having a difficult time making a decision, ry answering t these questions: • Have I reviewed the facts carefully? • Who will be affected by my decision? • Have I thought carefully about my options? • What are the consequences of my choices? • Will my decision stand the test of time? • Will my decision reflect positively on Tesoro and on me? • Is this the right thing to do? If you are still not sure what to do, speak up. Keep asking questions until you are sure you can “do the right thing.” When in Doubt, ALWAYS Ask! 9 Good Ethics is Good Business
  • 10. Obey the Law
  • 11. A Culture of Compliance Duty to Comply Obeying the law — both its spirit and its letter — is the foundation on which our standards are built. Each of us must respect and obey the laws of the cities, states, and countries where we operate. However, complying with the law is not our only responsibility. We should consider not only what the law permits us to do, but also what is the “right thing to do.” To Learn More Policy 10.20.010, Obeying the Law What Our Program Offers Our Business Conduct Office supports the Code of Business Conduct. This Office offers many services: • eveloping clear guidelines about Tesoro’s ethical and D legal standards. • Providing education and training. • esponding to questions about business conduct. R • nsuring that our Code and policies are current. E • Managing the Code of Conduct Helpline. • Enforcing our policy prohibiting retaliation. • verseeing confidential internal investigations. O • onitoring and auditing to improve our compliance programs. M Calling the Code of Conduct Helpline Each day you make choices that are critical to our success. Our Code of Conduct Helpline is an important way for you to get answers to your questions or report concerns. Our Helpline is available 24 hours a day, 7 days a week and may be contacted directly at 1-877-782-3763. An independent third party will take your call, listen, and ask questions about your concern. You will receive a unique number and date so that you can follow-up on your call. A report of your call is promptly forwarded to the Business Conduct Office for action. 11 Good Ethics is Good Business
  • 12. All calls to the Code of Conduct Helpline are confidential. Our goal is to answer your questions and to handle issues fairly and consistently. We will make sure that reports of improper conduct are thoroughly investigated. We will take appropriate action to resolve each reported matter. When you contact us, you may remain anonymous. Sometimes, it may become necessary to know your identity in order to resolve your concern. We will tell you when that is the case. You should call the Code of Conduct Helpline when: • ou have a question about ethics, business conduct, Y or compliance. • ou want to report a suspected violation of the Code, the law, Y or a Tesoro policy. • ou have a concern or information regarding questionable Y accounting or auditing matters. • ou tried to raise a concern but did not receive a response. Y • ou are uncomfortable reporting an issue through Y other channels. • ou believe management may be involved or will not Y be impartial. • ou don’t know where to go to get the information you need. Y • You want advice before you act. Calls to the Helpline are Confidential
  • 13. Prohibition Against Retaliation It is Tesoro’s obligation to protect you from retaliation. When you step forward to report something you believe is unethical or illegal, we will investigate and address the problem. Individuals who raise concerns in good faith or who help to resolve reported matters are protected against retaliation. Good faith does not mean that you are always right. It does mean that you sincerely believe that you are telling the truth. Anyone who misuses this program will be subject to disciplinary action. Conducting Investigations We investigate reports about business conduct as promptly and confidentially as possible. Our investigations are impartial, fair, and thorough. Who conducts an investigation depends on the issues involved. Sometimes the Business Conduct Office, Legal Department, Internal Audit, Corporate Security, or Human Resources may participate. We may contact those who are involved in the situation, and provide them an opportunity to explain what happened. We expect your full cooperation. If we find that our standards have been violated, we will take action. This may include imposing disciplinary action, implementing system-wide changes, or notifying the right government agency. Not only will we deal with a specific situation, but we may also make changes so that the same problem does not recur. We cooperate fully with government investigations and are courteous to government officials. Notify the Legal Department immediately if you learn about an investigation or request for information from an outside organization. Do not try to respond without getting legal advice. During an investigation, never destroy or alter documents, lie, or obstruct the collection of information. The Legal Department will assist you in responding to requests for information from the government. Disciplinary Action Violations of the law, this Code, or our policies can have severe consequences. Violations can jeopardize our relationships with customers and suppliers, and could result in loss of our ability to do business. Anyone who violates the law, this Code, or our policies is subject to disciplinary action up to and including termination. 13 Good Ethics is Good Business
  • 14. Report Unethical or Illegal Activity
  • 15. Working Together Confidentiality and Privacy In Brief You may come across confidential information about our company, employees, customers, or suppliers. It is critical that you keep all sensitive information in confidence. You should share confidential information only with those who have a legitimate need to know. Key Points Employee Information Employee information is confidential and should only be used for valid business purposes and in compliance with applicable federal and state laws. This includes personnel file information, medical records, social security numbers, home addresses, and telephone numbers. We reserve the right to inspect our property, including computers, telephone records, vehicles, lockers, e-mail, files, business documents, and workplaces. You should not expect privacy when using company property. Company Information You may have access to Tesoro’s confidential or proprietary information that must be protected from disclosure. Examples include: • Business strategies and plans. • Projected earnings. • Forecasts about our financial condition. • Operating methods and procedures. • Marketing strategies. • Possible acquisitions. • nformation about current or prospective I business partners. • Customer data. The duty to keep information in confidence continues even after you leave Tesoro. Talk with your supervisor if you have questions about how to handle confidential information of any kind. doing the RIGHT thing 16
  • 16. In Action • Respect our customers’ private information. • on’t discuss confidential information where others D can overhear. • ever use confidential company information for personal gain. N • ever disclose confidential information of any kind without first N obtaining the proper approvals from your supervisor or the Legal Department. To Learn More Policy 10.20.007, Confidential Information Policy 10.20.011, Conflicts of Interest Drug and Alcohol Abuse In Brief We expect our workplaces to be free from the effects of drug use and alcohol abuse. Illegal drug and alcohol use threatens our ability to serve our customers and compromises the safety and quality of our products and services. We reserve the right to search personal property to enforce our rules. Key Points We expect your full concentration while on the job. You must be able to perform your job, free from the effects of prohibited drugs or alcohol. Our workplaces have specific procedures on drug and alcohol abuse in order to meet government requirements or collective bargaining agreements. You are expected to know and comply with these rules. While on the job, on company property, or in company vehicles, you may not: • Possess or use alcohol. • se, sell, or possess illegal drugs, controlled substances, U or prescription drugs contrary to your doctor’s orders.
  • 17. Tesoro reserves the right to test employees for drug use or alcohol abuse. We may choose to test an employee for drug use or alcohol abuse randomly, after an accident, or for cause. In Action To maintain the safety of our workplace, you have the following responsibilities: • o not use or abuse drugs or alcohol when representing D Tesoro or while working at any company location. • emember that you represent Tesoro when you attend R business-related meetings or social gatherings. While attending, act responsibly. To Learn More Policy 20.10.040 Drug-Free Workplace Equality in Employment In Brief Each of us is personally responsible for maintaining a work environment that is free from discrimination. Tesoro respects the rights of others and offers equal employment opportunities to everyone who meets our qualifications. Key Points We are committed to fair practices in all aspects of employment. This includes recruiting, hiring, performance evaluation, training, discipline, work assignment, compensation, promotion, and termination. We follow federal and state labor and employment laws. We do not tolerate unlawful discrimination of any kind. Each of us has the right to be treated respectfully, without regard to race, color, religion, gender, national origin, age, disability, citizenship, or status as a veteran. Tesoro will make every reasonable effort to accommodate employees’ religious observances. Tesoro will also make reasonable accommodations for qualified individuals who are disabled. No employee will be subject to retaliation for reporting an incident that they believe, in good faith, violates this policy. doing the RIGHT thing 18
  • 18. In Action • ach of us is responsible for promoting a courteous, respectful, E and professional work environment. • reat everyone with whom you work fairly and reasonably. T • f you need a workplace accommodation, discuss your needs I with your supervisor and Human Resources. • peak up if you feel that you have been discriminated against S or if you witness discrimination against others. • If you are uncomfortable speaking with your supervisor, you may contact Human Resources or the Business Conduct Office. To Learn More Policy 20.01.010, Equal Employment Opportunity Policy 20.10.050, Harassment Harassment In Brief Harassment is behavior that unreasonably disrupts another person in his or her work because of that person’s race, color, religion, gender, national origin, age, disability, citizenship, status as a veteran, or sexual orientation. Each of us has the right to be free from improper or offensive conduct at work. Unwelcome or insulting words or actions that create an offensive workplace do not belong at Tesoro. You must follow all policies and work rules that eliminate workplace harassment. Exercise good judgment in your relationships with co-workers. Each of us wants to be valued for who we are and what we can contribute. Each of us wants to work where we are respected and appreciated. Key Points Sexual harassment can occur under many different circumstances. In general, it occurs when: • equests for dates, sexual favors, or other similar conduct of R a sexual nature serve as the basis for employment decisions. • n intimidating, offensive, or hostile work environment A results from sexual advances, offensive jokes, or other insulting behavior. • exually suggestive, vulgar, or derogatory pictures, cartoons, S drawings, or e-mails are present in the workplace. 19 Good Ethics is Good Business
  • 19. In Action • eview your decisions to ensure that merit drives your R actions — not bias. • ever threaten to get even with someone who refuses a N request for a date. • e careful about flirting or starting a workplace romance. B Once someone says “no,” refrain from any further advances. • e careful not to use offensive or sexually explicit language in B the workplace or e-mails. • now your audience before telling a joke. What is funny to you K may be offensive to someone else. Make sure your comments are appropriate for your audience. To Learn More Policy 20.10.050, Harassment Policy 20.01.010, Equal Employment Opportunity Workplace Violence In Brief We provide a safe workplace for everyone. We will not tolerate workplace violence or threats of any kind — whether committed by or against our employees. We prohibit having weapons on our property, in company vehicles, or wherever we conduct business. We act promptly to investigate and reduce threats of workplace violence. We reserve the right to search personal property to enforce our standards. Key Points The following behaviors are prohibited: • Making threatening remarks. • Causing physical injury to someone else. • ntentionally damaging someone else’s property, or acting I aggressively in a way that causes someone to fear injury. • poken or written words, as well as actions, are S included in our definition of threatening behavior. doing the RIGHT thing 20
  • 20. In Action To maintain the safety of our workplace, you have the following responsibilities: • Treat everyone with respect and dignity at all times. • eport all threatening behavior to your supervisor, Human R Resources, Corporate Security, or the Code of Conduct Helpline. To Learn More Policy 10.20.021, Antiviolence Treat Everyone with Respect and Dignity 21 Good Ethics is Good Business
  • 21. Conducting Our Business Antitrust, Sales Practices, and Fair Dealing In Brief We deal fairly with our customers, suppliers, competitors, and employees. They trust us because we deliver on our promises. We are committed to fair and competitive sales practices. We do not engage in practices that unfairly limit trade or exclude competitors from the marketplace. Antitrust laws prohibit agreements that eliminate or discourage competition. We follow these laws carefully. Key Points Healthy business competition is the basis for our system of free markets. We think our products and services speak for themselves. That’s why we compete vigorously, ethically, and legally. We will not communicate formally or informally with competitors to fix or control prices, allocate market share, boycott customers or suppliers, or limit the sale of our products. We will not take unfair advantage of anyone through manipulation, misrepresentation, or any other type of unfair dealing. Properly gathered business information is valuable. We gather information about our competitors only from public sources that are freely available to others. In Action • void even casual conversations with our competitors A regarding prices, products, markets, or services. • ggressive competition is not an excuse for intentionally A making false or misleading statements about our competitors. • ever require a customer to take an unwanted product in order N to obtain a product that the customer does want to buy. • f people are discussing topics you think raise antitrust I concerns, you should excuse yourself from the conversation and leave the room. Then, immediately contact the Legal Department for advice. • ever commit an illegal or unethical act in order to obtain N competitive information. 23 Good Ethics is Good Business
  • 22. • Do not set prices below cost to drive a competitor out of the marketplace. • e sure to read our Antitrust Compliance Manual and attend B required training on antitrust laws. • Above all else, use your common sense. To Learn More Policy 10.10.018, Antitrust Compliance Policy 10.20.017, General Sales Practices Tesoro Corporation Antitrust Compliance Manual Business Records and Internal Controls In Brief Our reputation for honest dealing is one of our most valuable assets. By observing the law, we build our reputation as an honest business partner. We maintain accurate and complete records of all financial and business transactions. These records provide the basis upon which our financial statements and other business information are compiled and disclosed. You must never record or omit information that intentionally hides or alters the truth. You are responsible for following our system of internal controls. Each of us must record transactions accurately and completely and follow all accounting policies and procedures. No false or misleading entries should ever be made in our books and records. Key Points Generally Accepted Accounting Principles We keep all financial records in accordance with generally accepted accounting principles in the United States of America (U.S. GAAP). Our system of financial controls, checks, and balances helps ensure that we properly account for revenues, expenses, assets, and liabilities. Records Management We have a records management system that determines what records we need to keep and for how long. It is your responsibility to know and follow the specific rules for the business records in your area. Records Requests If you receive a request for records from someone outside of Tesoro, contact the Legal Department. They will provide instructions on how to respond. Never destroy records that are related to ongoing litigation or an official investigation. doing the RIGHT thing 24
  • 23. In Action • ur books and records should be accurate and our O disclosures transparent. • repare all records including expense reports, time reports, and P financial statements — accurately, honestly, and promptly. • ring to the attention of the Business Conduct Office, B Compliance Officer and General Counsel, or Chairman of the Audit Committee any irregularity or inconsistency in our records and books. • ever write anything in an electronic format that you would not N feel comfortable reading in a formal written memo. To Learn More Policy 10.40.010, Records Management Policy 10.20.012, Business Practices Conflicts of Interest In Brief A conflict of interest occurs when your private interests interfere — or appear to interfere — with the best interests of Tesoro. A conflict of interest may also arise when your personal interests adversely impact your business judgment or job performance. We avoid conflicts of interest because they can cause serious problems for you and damage our reputation. We need to avoid even the appearance of a conflict of interest. You should base business decisions on our company’s needs rather than your own personal interests or the interests of your friends or family. Unless approved by our Compliance Officer and General Counsel, you should not pursue business with companies in which you, or members of your immediate family1 have a substantial financial interest2. In addition, neither you nor your immediate family should own a substantial financial interest in any organization doing business or competing with our company, unless approved by our Compliance Officer and General Counsel. 1 Your immediate family includes your spouse, children, stepchildren, parents, stepparents, brothers, sisters, grandparents, in-laws, and any other person living in your same household. 2 A substantial financial interest is one percent of any class of the outstanding securities of a firm or corporation, or interest in a partnership, limited liability company or association. A substantial financial interest can also be five percent of your total direct and beneficial assets or income. 25 Good Ethics is Good Business
  • 24. If you have any doubt about whether a conflict of interest exists, follow these three steps: • ecognize that there may be a conflict of interest. R • isclose and explain the situation to your supervisor, the Legal D Department, or the Business Conduct Office. • et advice and, when called for, remove yourself from all G decision-making about the situation. Key Points Personal Business Relationships You must disclose to the Compliance Officer and General Counsel significant financial interests you have or your immediate family has in our suppliers, customers, or competitors. Executive officers must disclose their financial interests to the Compliance Officer and General Counsel and the Chairman of the Board of Directors. Be careful that your personal business relationships never influence the decisions you make for Tesoro. Organizational Relationships If you or your immediate family serves as an officer, consultant, or board member of any company that transacts business with Tesoro, you must disclose these obligations to the Compliance Officer and General Counsel and get approval. When you disclose your organizational relationships, we can determine whether you are in a position to unduly influence either the decisions of the outside organization or Tesoro. We can provide advice on how to resolve the situation fairly. Business Opportunities Business opportunities are company assets. Tesoro will grow and prosper by cultivating customers and pursuing new leads. Do not take personal advantage of business opportunities you discover using Tesoro’s resources. Tesoro employees should not compete against Tesoro. Each of us should advance Tesoro’s legitimate interests whenever we can. In Action • Talk with your supervisor or the Business Conduct Office about any situation that raises a real or possible conflict of interest. • Use company resources, assets, and opportunities only for Tesoro’s business purposes. • Disclosure and getting advice are the best steps you can take to avoid even the appearance of a conflict of interest. To Learn More Policy 10.20.011, Conflicts of Interest Policy 10.20.012, Business Practices doing the RIGHT thing 26
  • 25. Fraud In Brief Fraud can range from minor employee theft to significant misstatement of our earnings and holdings. Material financial fraud can have an adverse effect on our reputation and share price. Fraud is often accompanied by collusion and stealth. Key Points It is wrong to: • naccurately record time for reporting purposes. I • alsify quality, environmental, or safety reports. F • Process or submit false or inaccurate invoices. • Record false sales or expense reports. • Understate or overstate known liabilities and assets. • efer or accelerate recording of transactions in incorrect periods. D • lter, remove, or destroy company documents except in A accordance with our records retention policy. • Use company property for personal gain or benefit. To Learn More Policy 10.20.014, Sensitive Payments and Related Practices Policy 10.20.009, Insider Trading Policy 10.20.012, Business Practices General Procurement In Brief We use vendors, suppliers, and contractors who best meet our needs. Our vendors, suppliers, and contractors sell us goods and services that are essential to our business. We protect from disclosure their confidential and proprietary data. We don’t reveal pricing or other confidential information to those who are competing for our business. Key Points We purchase from qualified suppliers whose bids are the most responsive to our needs. Selection decisions are based on objective information such as price, past performance, business reputation, engineering skill, production capacity, and financial stability. 27 Good Ethics is Good Business
  • 26. We select vendors with care because their actions impact our reputation. Former employees who represent a vendor should be screened carefully to prevent misuse of company information, creation of an unfair advantage, or the appearance of a conflict of interest. If you have become a personal friend of a vendor over time, disclose this relationship before participating in the selection process. We can help you evaluate the situation and avoid conflicts of interest. You cannot afford to let your good business judgment be clouded by a gift provided by a vendor. Discounts or special offers must be offered to all Tesoro employees through a regular discount or buying program. If a vendor offers you any item of appreciation, talk it over with your manager before you accept. In Action • ake sure that our vendors, suppliers, and consultants M understand our expectations and their obligations to perform. • e treat our suppliers, vendors, and consultants ethically W at all times. To Learn More Policy 25.00.010, General Procurement Policy 10.20.017, General Sales Practices Policy 10.20.011, Conflicts of Interest Policy 10.20.001, Code of Business Conduct and Ethics Policy 25.00.015, Supplier Diversity Policy 25.00.016, Supplier Relations Gifts, Hospitality, and Entertainment In Brief A gift can be anything of value, including goods, services, favors, meals, trips, hospitality, and sports or entertainment tickets. Gift giving can be a part of conducting business. However, giving and accepting gifts may — or may appear to — compromise your independence and objectivity. This perception can damage your good name and our standing in the business community. We follow two primary rules when it comes to giving or receiving gifts: • gift, favor, or entertainment should not be given or accepted A if it will obligate or appear to obligate Tesoro or you. • o gift should be exchanged if it could jeopardize our image N or reputation. doing the RIGHT thing 28
  • 27. You should review Tesoro’s Gifts Policy (10.20.005) on our intranet site, and comply with our policy limits on the value of gifts offered or received. This policy establishes approval requirements for gifts of any kind. Key Points Giving Gifts We compete solely on the merits of our products and services. You should not give any gift if, under the circumstances, this raises questions about its propriety. We may provide gifts, meals, and entertainment of reasonable value in the course of doing business with commercial customers or non-government personnel, provided this practice does not conflict with our standards or the standards of the recipient’s organization. Gifts of modest value can be given, for instance, to acknowledge good service, to motivate performance, or to promote Tesoro’s products and services. Gifts may be given if: • There is a sound business purpose. • They support our corporate strategy. • Your supervisor authorizes them. • They are within approved budgets. Receiving Gifts Ask yourself if a gift that you are offered looks like an attempt to sway your judgment. You should not accept a gift from someone doing — or wanting to do — business with Tesoro, if this is an attempt to improperly influence your decisions. Generally, you may receive infrequent gifts of modest value. You can accept promotional items, such as pens, note pads, or coffee mugs. Government Relationships Most government agencies do not allow their employees to accept even nominal gifts. Avoid giving any type of gift to federal, state, or local government employees. In Action • f you have any questions about giving or receiving gifts, I contact the Business Conduct Office or our Compliance Officer and General Counsel for advice. • nsure that meals and entertainment have valid E business purposes. • It is never acceptable to give or receive a gift of cash. • ake sure the vendors and suppliers with whom you do M business are familiar with our rules on gifts, hospitality, and entertainment. 29 Good Ethics is Good Business
  • 28. To Learn More Policy 10.20.005, Gifts Policy 10.20.011, Conflicts of Interest Insider Information In Brief You may learn of material inside information about our company or other companies with which we do business. It is illegal for you to buy or sell securities of any company while possessing material inside information about that company or to pass that information on to someone else who then buys or sells securities of that company. This is called insider trading. Key Points Material inside information is non-public information that is significant enough to affect the value of a company’s stock, or to influence someone to buy or sell stock. Examples of material inside information include significant contracts, financial forecasts or earnings estimates, major management changes, proposed mergers or acquisitions, major litigation, or securities offerings. All non-public information about Tesoro should be considered confidential. Public information is the kind of information that is generally available in a press release, a major newspaper, or an SEC filing. In Action • o not buy or sell securities of Tesoro or any other company D based on non-public information. • o not pass inside information to someone who has no need D to know. • eep in confidence any material inside information you learn K about Tesoro or any other company. • ever buy, sell, or trade in options, puts, calls, or similar N types of speculative instruments or take short positions in Tesoro’s securities. • et legal advice if you are not certain whether it is OK to buy G securities or sell securities that you own. To Learn More Policy 10.20.009, Insider Trading Policy 10.10.008, Selective Disclosure with Investment Community Policy 10.20.011, Conflicts of Interest doing the RIGHT thing 30
  • 29. Political Contributions In Brief We comply with all laws regulating our company’s participation in political affairs, including contributions to political parties, committees, or individual candidates. Any political contribution made by Tesoro will be made only in compliance with the law. Key Points Tesoro maintains state and federal Political Action Committees (PACs). The head of Governmental Affairs must approve all political contributions in advance — whether through the use of a Tesoro PAC or through corporate funds. We encourage everyone to be an informed voter and to get involved in the political process. Your participation is entirely voluntary. If you choose to participate, your contributions must be on a personal basis, using your own time and funds. Tesoro will not reimburse you for any contributions that you make. In Action • o not use work time, money, or resources to promote a D political campaign or candidate. • ever loan or use company property for political purposes that N are not authorized in advance by Tesoro. • e careful to avoid giving the impression that you are speaking B on behalf of Tesoro when you participate as a citizen in the political process. To Learn More Policy 10.20.025, Political Activity Policy 10.20.011, Conflicts of Interest Sensitive Payments In Brief We believe customers should choose our products and services because of their intrinsic value, not because they received something extra from us. You must never offer anything of value to obtain an improper advantage when conducting Tesoro’s business. We prohibit kickbacks, bribes, and payoffs. This includes the giving or accepting of money, fees, gifts, favors, or anything of value provided directly or indirectly in return for more favorable treatment. 31 Good Ethics is Good Business
  • 30. Key Points It is just as wrong to offer a kickback as it is to accept a bribe. Never accept anything from a vendor or supplier in exchange for favorably considering their product. Remember, your good judgment is not for sale. All countries prohibit bribery of their public officials. Many countries, including the United States, also prohibit bribery of officials of other countries. Generally, these laws prohibit giving anything of value to foreign officials or their family members for the purpose of obtaining business. At Tesoro, our policy extends beyond these laws. You may not make an unauthorized payment, concession, or bribe to government officials or employees or to private parties engaged in a commercial transaction. In limited circumstances in some countries outside of the United States, you may need to pay a government official to obtain a benefit to which Tesoro is entitled under local law. These facilitating payments must be modest in amount and necessary to achieve a valid business purpose. Never make a facilitating payment without first consulting the Legal Department. If you must make a facilitating payment, be sure to record and account for it properly. In Action • on’t make payments or give gifts that are intended to increase D the volume of business that customers do with Tesoro. • ever hide a payment or falsify business records. N • nappropriate or questionable payments made through an I intermediary are just as unacceptable as those that are made directly. • ever establish any secret, “off the books,” or unrecorded N funds, assets, or transactions. • gents who represent Tesoro outside of the United States must A comply with our Code of Business Conduct. To Learn More Policy 10.20.014, Sensitive Payments and Related Practices doing the RIGHT thing 32
  • 31. Prepare Records • timely • honestly • accurately
  • 32. Protecting Resources Company Property and Technology In Brief You are entrusted with company property in order to do your job. Each of us is responsible for safeguarding Tesoro’s funds, records, tools, vehicles, equipment, supplies, and property. We are responsible for using company property and technology efficiently. Key Points All of our assets, including our technology and communications systems, should be used for legitimate business purposes. Tesoro has the right to monitor and review the information contained in these systems. Within reasonable limits, you may use company telephones or other resources such as e-mail, instant messaging, Internet, voice mail, faxes, and computers for limited personal communication. You are encouraged to use the Internet to help you do your job. However, the Internet — just like the telephone and other company property — should not be used to support a personal business or political venture. We protect our computer systems from unauthorized access by outsiders. This is one way to safeguard our confidential and proprietary information. In Action • reserve our assets, take care to prevent theft, loss, or damage P to our property. • oftware programs may not be copied for other kinds of S business or home use, or shared with others. • ou should not expect privacy when using Tesoro’s equipment Y or technology. • o not plug in personal computing devices to the D Tesoro network. • afeguard your passwords and follow all directions about S computer security. • rotect information from improper alteration. P • se only properly licensed software. Follow the terms of our U licenses. doing the RIGHT thing 34
  • 33. Some content is never acceptable to be sent or received on our communications resources: • exually explicit messages, cartoons, images, or jokes. S • rofanity or obscenity. P • ntimidating, offensive, or hostile material based on sex, age, I race, religion, national origin, disability, or other protected legal status. • ersonal opinions masquerading as company opinions P or commitments. To Learn More Policy 21.60.040, Information Technology: cceptable Use A Policy 24.00.020, Loss of Company Property Environment, Health, and Safety In Brief Our goal is to protect our environment from harm. Each of us is responsible for minimizing adverse environmental impact, reducing waste and emissions, and promoting conservation. We believe that all accidents and workplace illnesses can be prevented. Accident prevention is good business. We expect everyone to work safely and think safety. We expect supervisors and managers to prevent accidents. We never compromise safety. Our safety standards are posted in all company locations and facilities as reminders of our fundamental commitments. Key Points All our facilities must operate with the necessary permits, approvals, and controls that protect the environment. We take special care to ensure that we do not discharge hazardous substances beyond those allowed in our permits and approvals and we strive to reduce all emissions from our facilities. Each of us is responsible for reporting safety hazards, accidents, and incidents — no matter how minor. We act promptly to investigate situations that create workplace hazards. We take immediate corrective action to eliminate unsafe practices and prevent injuries. Protect our Environment
  • 34. You are on the front line to ensure that our operations are conducted safely. If you identify a condition that warrants investigation, be prepared to provide details to your supervisor about: • The nature of the problem. • The location of the problem. • When the problem occurred (date and time). • ame and quantity of materials involved, to the extent known. N • he extent of injuries, if known, and any additional information T you may have — particularly eyewitness information, documents, or photographs. In Action You have the following responsibilities: • Follow all safety policies and procedures carefully. • se protective equipment and personal gear that is appropriate U for the task at hand. • Operate vehicles and marine vessels properly. • Always be prepared for fire protection. • ecome familiar with the laws, regulations, policies, and B procedures that apply to your own job duties. • Properly and safely dispose of hazardous materials. To Learn More Policy 23.10.010, Safety and Health Objectives Intellectual Property In Brief Our intellectual property is extremely valuable. It includes trademarks, copyrights, patents, trade secrets, technical and business knowledge, know- how, and experience. Each of us is responsible for protecting Tesoro’s intellectual property and reporting infringements. We do not disclose business ideas, projects, or plans to anyone who does not have a legitimate need to know. Any invention or improvement conceived or discovered during the course of your employment belongs to Tesoro, and must be disclosed to the Legal Department. doing the RIGHT thing 36
  • 35. Key Points Intellectual property covers a wide range of information and knowledge. It is valuable, in part because it includes facts, data, and knowledge that have not been disclosed to the public. Here are some examples of our intellectual property: • Market research data and results. • Engineering processes and techniques. • Technical drawings and plans. • Customer and supplier lists. • Business analysis. • Marketing strategies. • Pricing records. • Plant layouts, engineering designs, and blue prints. Other companies also protect their confidential and proprietary information. We respect their rights. We do not tolerate the unauthorized copying or disclosure of another’s intellectual property. You may use other people’s information only if you have received their written consent or if the information is publicly available without restriction. In Action • peak to the Legal Department if you have questions about S an invention or discovery. • Follow our copyright licensing agreements. • enerally, you can make a reasonable number of photocopies G of selected copyrighted materials for internal use. To Learn More Policy 10.20.008, Inventions and Improvements Policy 21.60.040, Information Technology: Acceptable Use Media and External Contacts In Brief We receive questions daily from external contacts about our business. The Corporate Communications Department or designated media spokesperson shall handle calls from the media and the investment community. They determine whether and when interviews are appropriate. Channeling all calls through the Corporate Communications Department ensures that we 37 Good Ethics is Good Business
  • 36. convey a consistent message. They ensure that we do not disclose material information selectively. They control how information is released to the public so that this is done correctly. We are very careful not to release material, non-public information. This includes information about earnings, our securities, pending mergers or other transactions, changes in management, new products, and discoveries. In Action • ssume that all discussions with a member of the media are A “on the record.” • on’t try to answer a media question yourself, even if you D think you know the answer. • ll information about Tesoro and its projects, including those A involving other companies, must be reviewed prior to release. • f you talk to the media about your outside interests, make I it clear that any opinion you give is your own, and not that of Tesoro. To Learn More Policy 10.30.010, Designated Spokespersons and Media Communications Policy 10.10.008, Selective Disclosure with Investment Community Policy 10.30.030, Tracking Communication from External Parties doing the RIGHT thing 38
  • 37. 39 Good Ethics is Good Business
  • 38. Notes
  • 39. Notes
  • 40. Business Conduct Office Tesoro Corporation® San Antonio, Texas rev2007

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